There's this article from MoneyManager called What's up with no-docs? which talks about some proposed legislation to regulate mortgage brokers.
It might be unfair to blame broker for a loan default, but it's definitely a welcomed move to see government doing something to protect consumers!
Some of the proposed consumer protection from that article:
In the future mortgage brokers will have to:
* Be licensed;
* Go through probity checks;
* Meet mandatory educational requirements;
* Belong to a dispute resolution scheme;
* Have professional indemnity insurance;
* Disclose costs upfront;
* Declare any commissions;
* Ascertain a client's financial capacity to pay;
* Brokers may have to pay up to $25,000 in compensation if an inappropriate product causes a customer to lose money.They may also be fined up to$25,000 by the regulator.Ultimately, their licence can be suspended or cancelled.